Worldview with Suhasini Haidar | How does the wheat export ban affect foreign policy?

Worldview with Suhasini Haidar | How does the wheat export ban affect foreign policy?

In this episode, we examine the effect India’s flip-flop on wheat exports will have on its foreign policy.

This week the UN takes up global food security on a war footing- the Ukraine war, that is, which has led to a slump in wheat production from a region known as the world’s bread basket- Russia and Ukraine together account for 25% of the world’s wheat exports. India is the world’s second largest wheat producer and one of its biggest consumers- when the government decided last week to ban wheat exports in the face of climbing prices, there were many protests from the international community.

More about the foreign policy impact:

  • 1. As we speak, a UN Security Council discussion is underway on how to stabilize world food prices and supply amidst the pandemic and the war, and a UNGA vote on the issue is expected as well
  • 2. At the G-7 Agriculture minister meet last week, India was criticised for the wheat export ban decision, with the German minister saying India must “assume responsibility as a G20 member”. “If everyone starts to impose export restrictions or to close markets, that would worsen the crisis,” he told a press conference
  • 3. The US UN envoy Linda Greenfield Thomas also criticised the decision, saying the US discourages it and calling on India to reconsider its ban once the UNSC meet is over.
  • 4. China appears to have backed India’s right to secure its own food security interests first. In BRICS speech, President Xi Jinping spoke of unity amongst emerging markets, and Global Times had a rare defence of India where it said that instead of blaming India, G-7 countries should themselves step up exports.
  • 5. Pakistan’s Foreign Minister also weighed in saying while it is obviously the decision of the Indian government, but such actions are being discouraged at multilateral fora.

So what has India said about why it needed to impose the sudden ban on wheat exports:

  • 1. A heatwave in March and April has reduced India’s projection of wheat production this year- which was expected to be over 110 million tonnes, but now is being pegged below 100 million tonnes, and its plans to export about 10 mn this year have been hit.
  • 2. The government says its export ban is flexible, and any confirmed orders will not be included. The government will consider on a case by case basis requests from neighbouring countries and vulnerable countries facing food emergencies on a G2G level.
  • 3. An 8-point solution was proposed at the UNSC – including a call to end the Ukraine war, recognition of the impact of the war on the global south, which has been hit by food inflation the most, and an end to international hoarding and speculation
  • 4. India has helped countries in the past bilaterally with food exports, like wheat to Afghanistan, rice to Sri Lanka, and grains to Africa, and has a track record in global food security, so must be allowed to make its own decisions.
  • 5. India has called for aid and assistance to be left as sovereign decisions, and not politicise measures taken in national security, which includes food security interests.

So why do we call the policy a series of flip-flops?

Simply because the India stand has moved from one extreme to another in the past few months.

  • 1. First, it said it would speed up wheat exports

-During the India-US summit held with the 2+2 in Washington on April 11, PM Modi said he had promised US President Biden that if the WTO permitted India could export wheat grains worldwide.

-On April 22, Finance Minister Nirmala Sitharaman said at the World Bank and IMF meetings in Washington that countries like India who could supply food grains were facing difficulties at the WTO Meetings.

-At the Raisina dialogue on April 25 EAM Jaishankar said India would help the world with wheat supplies, and step up its role in cooling prices

-Commerce Minister Piyush Goyal, who is also the Food supplies minister said the government had completed deals with Egypt and Turkey and would despatch teams Morocco, Tunisia, Algeria in North Africa, Indonesia, Philippines, Thailand, Turkey and Lebanon to discuss wheat export possibilities.

  • 2. Then came the shocker, as on May 13 the government issued an order banning all wheat exports until further notice
  • 3. Subsequently, the government has said there are many exceptions- that India would continue with all existing orders, that it would consider countries’ requests case by case, and hinted that if wheat prices come down, it could reconsider the ban.

How does this decision essentially about domestic constraints, affect India’s foreign policy?

  • 1. Flipflop undermines India’s international credibility, especially during Covid. Similar promises and bans marked the government’s policy on :

-Covid Medicines like HCQ and Paracetamol in 2020

-Vaccines in 2021

  • 2. US and EU were hoping India would step into the breach given sanctions on Russia and the Ukraine supply problems. India’s offer to export wheat was seen as a step away from its neutral position by offering to help counter Russia’s actions. The US accuses Russia of blockading Ukrainian ports, confiscating its produce and hoarding wheat supplies
  • 3. India’s decision to ban and control wheat exports is seen as a contravention of India’s WTO commitments on free trade. It is also an opportunity lost, say experts: India could have been a key wheat exporter, apart from a pillar of food security in the world.
  • 4. Wheat exports have now become a new area where India differs from the US and EU:

– India has refused to criticise Russia and abstained from all votes at the UN on the Ukraine war

– India is importing more oil from Russia, as the West is trying to cut this down. According to estimates India imported more oil in 2 months, 2.5 times what it did in all of 2021.

– And India has held rounds of negotiations to discuss circumventing the sanctions with Russia with the central bank

  • 5. This is something we will likely hear more about on the international stage, as PM Modi heads to the Quad summit in Tokyo on May 24, he will take part in a BRICS virtual summit hosted by China on June 23-24, and then is a special invitee along with leaders of Indonesia, South Africa and Senegal at the G-7 summit in Germany on July 26-28.

Ensuring National security, including food security is every nation’s right, and India cannot be faulted for battening down on its wheat exports in the face of a shortfall due to climate and other reasons. Where the government can be faulted is in making promises at the international stage which it has reversed within a few weeks. Credibility, consistency and dependability remain very important determinants of any country’s foreign policy, and of the power and influence it wields in the world.

Without getting very technical, there is some reading to recommend on the issues of food security.

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